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“Modest reforms to pay and compensation will improve readiness and modernization. It will help keep our all-volunteer force sustainable and strong. Keeping faith also means investing sufficient resources so that we can uphold our sacred obligations to defend the nation and to send our sons and daughters to war with only the best training, leadership and equipment. We can’t shrink from our obligations to one another. The stakes are too high.”

It appears that the White House may be rethinking Overseas Contingency Operations (OCO) accounts, just as BFAD suggested earlier this fall. Defense Newsreported yesterday that an OMB passback memo to the Pentagon regarding its FY13 budget included guidance that DOD should “provide line item-level detail by Aug. 1 2012, of the ‘enduring activities’ that could be shifted out of the OCO bill and into the base budget.”

Unlike the defense base budget, the separate war funding OCO account is exempt from the BCA budget caps, as well as sequestration. Back in August, BFAD noted the temptation created by OCO to shield non-war costs from cuts by shifting them into the protected war funding account—a temptation that ultimately proved irresistible for Senate appropriators.

The OMB document signals a move to close this loophole by keeping enduring costs in the base budget. Ultimately, however, Congress maintains the power of the purse and as our own Gordon Adams has pointed out, Senate Defense appropriators established a dangerous precedent by moving non-war costs into the war budget in their FY12 mark. It’s a slippery slope of budgetary legerdemain from there.